Poverty as a Challenge NCERT Solutions - Indian Economy for UPSC CSE

Q1. Describe how the poverty line is estimated in India?
Ans: The poverty line is estimated based on consumption levels in India. 

• A person has basic needs which include the minimum level of food, clothing, educational and medical needs; etc.
• These minimum consumptions are then calculated in Rupees and total becomes the minimum income required to fulfil basic needs.
• A person is considered poor if their income level falls below the minimum level necessary to fulfil basic needs.

Q2. Do you think that present methodology of poverty estimation is appropriate?
Ans:

• The current poverty estimation methodology focuses on minimum subsistence levels of living, rather than a reasonable level of living.
• It considers a person poor if their income or consumption falls below a minimum level required for fulfilling basic needs.
• While addressing minimum income levels is essential, the government should also focus on broader aspects of human poverty.
• Ensuring access to food is important, but a poverty-free state also requires addressing issues such as illiteracy, lack of job opportunities, and inadequate healthcare and sanitation.
• Factors like caste and gender discrimination also play a significant role in perpetuating poverty and should be considered in poverty estimation methodologies.

Q3. Describe poverty trends in India since 1973?
Ans:

• Overall decline in poverty: Since 1973, India has witnessed a substantial decline in poverty ratios, from about 55% in 1973 to 36% in 1993 and further down to approximately 26% in 2000.
• Stable number of poor: Despite the declining poverty ratio, the number of poor people remained stable at around 320 million for a long period. However, recent estimates show a significant decline to about 260 million.
• Rural vs. urban poverty: Poverty is a more significant issue in rural areas than in urban areas, with a larger proportion of the poor residing in villages.
• Vulnerable groups: Scheduled tribes, scheduled castes, rural agricultural laborers, and urban casual laborers are the groups most vulnerable to poverty, with their poverty ratios higher than the national average.
• State-wise poverty trends: Although every state has experienced a decline in poverty since the early 1970s, the success rate of reducing poverty varies across states. Twenty states and union territories have poverty ratios below the national average of 26%.
• Poorest states: Orrisa and Bihar continue to be the two poorest states, with poverty ratios of 47% and 43% respectively.
• States with significant decline in poverty: Kerala, Gujarat, Punjab, and Jammu and Kashmir have shown a significant decline in poverty rates.

Q4. Discuss the major reasons for poverty in India?
Ans: Major reasons for poverty in India:
(a) Colonial Rule

• India went through a long phase of low economic development under the British colonial administration. 
• The policies of the colonial government ruined traditional handicrafts and discouraged the development of industries like textiles.

(b) Low economic growth and high population growth

The Indian administration’s failure on the two fronts − promotion of economic growth and population control perpetuated the cycle of poverty.

(c) Rural Poverty

• The effects of agricultural and rural development were limited to only certain parts of the country. As a result, while some parts of the country showed great progress in the rural sector, others continued in the shadow of poverty.
• The presence of huge income inequalities is a major reason for the high poverty rates in rural areas.
• The government’s failure to properly implement major policy initiatives to tackle the issue of income inequalities has contributed to the continuance of poverty in villages.

(d) Urban Poverty

• The jobs created by the industrial sector have not been enough to absorb all the job seekers. Unable to find proper jobs in cities, many people start working as rickshaw pullers, vendors, construction workers, domestic servants, etc. 
• With irregular small incomes, these people cannot afford expensive housing. As a consequence, they start living in slums. Thus, poverty (a largely rural phenomenon sometime back) has become a dominant feature of urban India as well.

(e) Socio-Cultural Factors

• Various socio-cultural factors like caste and gender discrimination and social exclusion have contributed to the wider realm of human poverty.

Q5. Identify the social and economic groups which are most vulnerable to poverty in India.
Ans: The social groups vulnerable to poverty are:

• Scheduled castes households
• Scheduled tribes households

The economic groups vulnerable to poverty are:

• Rural agricultural labour households
• Urban casual labour households

Q6. Give an account of interstate disparities of poverty in India.
Ans:

• There is a difference in the proportion of poor people in the States.
• Estimates show that the average India HCR was 21.9% in 2011-12 but States like Bihar and Orissa are the two poorest states with poverty ratios of 33.7 and 37.6% respectively.
• In comparison, there has been a significant decline in poverty in Kerala, Jammu and Kashmir, Andhra Pradesh, Tamil Nadu, Gujarat and West Bengal.
• These States have used agricultural growth and Human Capital growth to reduce poverty.

Q7. Describe global poverty trends.
Ans:

• The proportion of people in developing countries living in extreme economic poverty has fallen from 43% in 1990 to 22% in 2008.
• There are disparities in poverty among the regions around the World. The number of the poor in China has come down from 85% in 1981 to 6% in 2011.
• In Sub-Saharan Africa, poverty declined from 51% in 1981 to 47% in 2008.
• In Latin America, the ratio of poverty has declined from 11% in 1981 to 6.4 per cent in 2008.

Q8. Describe current government strategy of poverty alleviation? 
Ans: The removal of poverty is one of the major objectives of the Indian developmental strategy.
The current government strategy of poverty alleviation is based on two planks:

• Promotion of Economic Growth.
• Targeted Anti-poverty Programmes.

Some of the targeted anti-poverty programmes undertaken by the government are:
(а) Prime Minister’s Rozgar Yojana (PMRY): This programme was started in 1993. It aims at creating self-employment opportunities for educated unemployed youth in rural areas and small towns.
(b) Pradhan Mantri Gramodaya Yojana (PMGY): This programme was launched in 2000. It aims at creating and improving basic services like primary health, primary education, rural shelter, rural drinking water and rural electrification.
(c) Rural Employment Generation Programme (REGP): This programme was launched in 1995. It aims at creating self-employment opportunities in rural areas and urban towns.
(d) Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA): This act was passed in September 2005. The act provides 100 days of assured employment every year to every rural household in 200 districts. Later, the scheme would be extended to 600 districts. One-third of the proposed jobs have been reserved for women.

MNREGA

Q9. Answer the following questions briefly
(a) What do you understand by human poverty?
(b) Who are the poorest of the poor?
(c) What are the main features of the National Rural Employment Guarantee Act 2005?
Ans:
(a)

• Human poverty is a concept that goes beyond the limited view of poverty as a lack of income.
• It refers to the denial of political, social and economic opportunities to an individual to maintain a “reasonable” standard of living.
• Illiteracy, lack of job opportunities, lack of access to proper healthcare and sanitation, caste and gender discrimination, etc., are all components of human poverty.

(b)

• Women, female infants and older people are the poorest of the poor. Within a low-income family, such individuals suffer more than others.
• They are systematically denied equal access to the resources available to the family.

(c) Main features of the National Rural Employment Guarantee Act 2005:

• The Act assures 100 days of employment every year to every household.
• Initially covering 200 districts, the Act would be extended later on to cover 600 districts.
• One-third of the jobs are reserved for women.